Navigating Gold Mutual Funds: Fundamentals and Insights

By Team Gullak
Apr 2, 2024
3 min read
gold-mutual-funds

Gold has a timeless allure. It has been a symbol of wealth and stability throughout history. From adorning kings to being a cornerstone of modern investment portfolios, its significance is undeniable. In this exploration, we delve into the realm of the best gold mutual fund Investments, focusing on gold mutual funds India. Discover how these funds, with their strategic approach, capitalise on gold's appeal.

Gold mutual funds are investment vehicles that pool resources from multiple investors to invest primarily in gold-related instruments. They offer substantial advantages over physical gold ownership. They provide you with a diversified and professionally managed avenue to manage your risk exposure.

How Gold Mutual Funds In India Work?

Gold mutual funds operate by investing in gold Exchange Traded Funds (ETFs), allowing you to indirectly own gold without the hassle of physical possession. The fund manager's role is pivotal. They make informed decisions based on market trends that impact the Net Asset Value (NAV).

Gold mutual funds returns are influenced by the movement of gold's price in international and domestic markets. The fund management strategies provide you with the potential for capital appreciation and exposure to the precious metal market.

Comparison with Alternatives: Understanding Gold Mutual Fund Returns

Investment Option5 Year Returns (approx)
Fixed Deposits (FDs)3% - 7%
Gold Mutual Funds7% - 10%
Gullak Gold PlusUp to 16% p.a.
Real Estate7% - 12%

Beat returns from Gold Mutual Funds

A curated list of the best gold mutual funds in India provides a starting point if you are looking to invest in gold. Understanding the performance, fees and track record of these funds is crucial in making an informed investment decision. It should be noted that the returns from the top 5 gold mutual funds in India were around 11%. However, in the worst case scenario, these gold mutual funds may even give you low or negative returns caused by the volatility of the market and poor decision-making of the fund manager.

Gullak Gold+: A Superior Alternative to Gold Mutual Funds

Gullak Gold+ offers a compelling alternative to gold mutual funds by providing several key benefits. It stands as a beacon in the world of digital gold investments, offering a seamless and innovative platform for gold investors.

In addition to the ~11% gold price appreciation, Gullak Gold+ offers extra 5% returns, taking your overall yearly returns to 16%.

With an entry point as low as 0.5 grams of gold, this platform provides daily interest calculations and the flexibility to exit at any time without charges.The extra interest on your investment is calculated daily and credited at the end of each month, ensuring that your returns are seamlessly accrued over time.

Pioneering the digitisation of gold transactions, Gullak Gold+ prioritises user experience, security and optimal returns, making it a standout choice for those seeking a modern and efficient gold investment solution.

This tabular comparison succinctly outlines the distinct advantages of Gullak Gold+ over gold mutual funds -

Returns Potential Gold price appreciation(~11%pa) Extra 5% on top of gold price appreciation, giving ~16%pa
LiquidityHigh liquidity with the ability to buy or sell gold mutual funds units easily. Highly liquid, can buy/sell anytime
Market DependencyInfluenced by gold market trends and fund manager's decisions. The 11% is market dependent but the extra 5% gold every year is assured

Gold mutual funds offer a convenient and accessible way to invest in gold, but they come with inherent risks and fees. Gullak Gold+ emerges as a strong alternative, potentially providing benefits like direct ownership, lower fee and the potential for higher returns.

Conclusion

As we conclude this exploration of Gold Mutual Funds as a potential investment avenue for you, it becomes evident that Gullak Gold+ stands out as the most beneficial choice. Its unparalleled performance, combined with the simplicity of savings and investments, positions Gullak Gold+ as the unrivalled champion among all investment options.

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Frequently Asked Questions
Is gold mutual funds a good investment?
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